TUPE - Are They Allowed To Do This?

snowcat53

What I am not clear about is who the new employer is to be. If there is no change of employer it is not TUPE.

Arer you sure the 'new management team' are not just new managers from the old Trust?

It sounds to me like management are not treating this as TUPE but as offering new terms & conditions under the same employer. This is quite legal although she is not obliged to accept and would have to consider the pros and cons of that.

However it is not legal to restructure before a TUPE if the purpose is simply to ease the transfer to the receiving organisation.

Bernard_Nurse

Hi Snowcat

My wife has dug out a letter she received from the NHS Trust back in May.

It states that '...the Trust has awarded a contract for the provision of on-site nursery services for <names of three hospital sites, two of which are already managed by the company concerned> to XXXXXX Ltd.'

It goes onto say that '...it is intended that the Transfer of Undertaking (Protection of Employment) Regulations 2006 will apply to transfer the contracts of employment and continuity of employment to staff of XXXXXX Ltd. It is not envisaged that there will be any legal, economic or social implications of the transfer for staff.'

So this is definitely a TUPE transfer.

This is, aside from letters about their pensions etc, to my knowledge all they have had in writing from the NHS Trust to date.

The following is the content of the sheet they were all given yesterday - note that it refers to 1st August 2012 in the future, not past tense:

'CONSULTATION PROCESS: POSSIBLE CHANGES TO TERMS
AND CONDITIONS
I am very sorry to have to inform you that, for the reasons described below, XXXXXX Ltd ("the Company") believes that it has no alternative but to embark upon a consultation process with you about potential changes to your terms and conditions of employment.

We are committed to build on the provision for the children.

The Commercial Position
As you are aware the company was successful in its bid to XXXXXX NHS Foundation Trust ("the Trust") to provide onsite nursery management services, and hopes to provide those services of the nursery on the XXXXXX Hospital site ("the Nursery") for a minimum of 5 years from 1 August 2012.'

So... looking at this, it appears they have submitted a bid to secure a contract to run three nurseries for the Trust, of which they already have two under their umbrella.

'As you may know, the primary reason that the Trust outsourced nursery functions was that the Nursery had been making considerable operational losses for several years, despite having been heavily subsidised by the Trust.

The subsidy provided by the Trust is not avoiloble to the Company after l August 2012.'

I am not sure what relevance, if any, this has to the nursery my wife works in; if indeed they took over the running of it on 1st August 2012 as the letter appears to suggest, then no subsidies have been paid in respect of it.

'In consequence, theNursery must remain financially viable through normal operational endeavours, just like any other business. That is to say, the Nursery will only remain financially viable if revenues generated from child places exceed the overhead costs of keeping the Nursery running.

We are therefore, presently faced with a not uncommon, but nevertheless serious problem, in the current economic climate.

We simply, with the current costs base, are not able to cover our overheads with the revenues generated and if we are to remain competitive in the marketplace we cannot significantly increase our fees to cover our existing overheads.

Therefore, unfortunately, it will not be possible for the Nursery to remain viable as a going concern unless its cost base is considerably reduced.

If it does not become viable as a going concern, consideration may have to be given to closure. The Company will be looking at all possible areas of the Nursery's business with a view to attempting to reduce costs but, having carefully considered how best to deliver the significant savings needed to allow the Nursery to remain viable, we hove reached a provisional view that it will be impossible to achieve those savings without asking staff at the Nursery whether they are prepared to accept changes to their terms of employment.

We will continue to seek to reduce costs and overheads in other areas such as fuel, heating, lighting, consumables etc but in reality our ability at this time to make significant in roads in these areos is limited.

The Proposals
The Company proposes to consult with all employees at the Nursery about whether they would be prepared lo agree to changes in their terms and conditions of employment. The principal changes being proposed for discussion would be as follows:

Holiday Pay: All full-time employees at the Nursery would be entitled to 5.6
weeks' holiday pay per holiday year, including bank and public holidays (i.e.
28 days).

Sick Pay: Sick pay entitlement would be reduced to statutory sick pay only;
Changes to Working Patterns: The number of hours per week that
employees would be obliged to work will remain the same. However, we will
review the working patterns (days, start and finish times) to assess their
efficiency and may adopt the work pattern as necessary to achieve
efficiencies in delivering continuity of care for the children.

Breaks: All employees would be entitled to a rest break of 30 minutes per
day.

Pay: All employees will hove their rates of pay reduced by 10%.

Pension: All employees would be entitled to join a stakeholder pension
scheme arranged by the Company. Details of which will be provided
separately.

If the proposed changes are implemented, it is planned that the new arrangements would take effect on lst October 2012. This is subject to the outcome of the consultation process and depending upon the degree of employee support.

Next Steps
We are sorry to have to give you this news, and understand that it may give rise to concerns. We now propose to embark upon a consultation process with you and, during that consultation process, we would want to discuss any concerns you may have with a view to seeking to reach an agreement.

A consultation meeting with all staff will take place on 9th August 2012 for all staff present any stoff who are absent will have the opportunity to arrange a 1:1 meeting to ensure every member of staff is consulted on the proposal.

If , after the meeting on 9th August 2012, you have any queries regarding the
proposals, or wish to suggest possible alternatives , please contact XXXXX or XXXXX.

The Company is keen to hear your views on the proposed changes prior to making any final decisions, We are hopeful that during the course of this consultation process you will recognise that these changes are the best way of providing the Nursery with a reasonoble chance of remaining financially viable thus safeguarding the employment of those who work here.

If you agree to these proposols please complete the slip attached to this letter and return it to XXXXX or XXXXX by Monday 27th August 2012, this will shortly be followed with a new contract to sign with the new terms incorporated.'

I have just contacted the HR Department of the Trust, and they have advised that they did all they needed to do legally in terms of staff consultation prior to the transfer. I don't believe they spelt out the implications for the staff in a way that they would have understood, but cannot prove this at present.

getmore4less

Looks like the TUPE has happened allready

This needs all the staff to get together and formulate a plan.

they are using one on ones to devide the group and using the threat of redundancy to try to force the change.

What id some were happy to be redundant to give the others their cuurent T&C's

I bet that once these changes are implimented there will be redundancies on thelower pa and statutory only.

The key thing will be if they need to fight for NHS redundacy terms if they were enhanced.

how easy will it be to recruite qualified and CRB'checked people on the proposed T&C's might be worth taking the redundancy money and cashing in the 10 years service

If enhanced NHS terms apply then it will likely never be so good again.

mjm3346

Have a read of the direct.gov website

http://www.direct.gov.uk/en/Employment/Employees/BusinessTransfersandtakeovers/DG_176391

If you find that there has been or will be a ’substantial change‘ for the worse in your working conditions as a result of the transfer, then you have the right to resign and claim unfair dismissal

The employer can do it if economic reasons justify it but I cannot see how they will have changed since they took it on as it was loss making anyway, it's not like they will have lost out on a big order/contract.

Looks like the NHS are trying to get out of their obligations re redundancy and pensions (they have already admitted it was running at a loss)

jackyann

Having been in the NHS all my working life, I sympathise, and please don't think I am criticising your wife if I say to anyone looking at this: do join a union.
I know most NHS staff do as your wife did - head down, get on with caring, let the politics of the management go over their heads.
They the kind of people who keep this country & the NHS going (sorry, not practically helpful, just offering sympathy)

I always thought my generous (aka reasonable) sickness benefits & pension were recompense for a relatively low wage; now the government want both.

marybelle01

mjm3346 wrote: »

Have a read of the direct.gov website

http://www.direct.gov.uk/en/Employment/Employees/BusinessTransfersandtakeovers/DG_176391




The employer can do it if economic reasons justify it but I cannot see how they will have changed since they took it on as it was loss making anyway, it's not like they will have lost out on a big order/contract.

Looks like the NHS are trying to get out of their obligations re redundancy and pensions (they have already admitted it was running at a loss)

I don't agree that it is wise to resign. There is not reason to. Changing the terms of employees after a TUPE can be challenged as unfair dismisaal at a tribunal without the staff resigning provided they specify that the reject the changes and are working under protest. If they resign and lose, they lose everything.

But I also disagree that the employer can't really do much because they took it on as loss making. If they did, that is actually a great reason to make the changes - it may be harsh on the staff I agree, but this company is not a charity, and the service either makes a profit or it gets shut down. Private sector companies do not subsidise good works.

BobQ

Bernard_Nurse wrote: »

Hi Snowcat

My wife has dug out a letter she received from the NHS Trust back in May.

It states that '...the Trust has awarded a contract for the provision of on-site nursery services for <names of three hospital sites, two of which are already managed by the company concerned> to XXXXXX Ltd.'

It goes onto say that '...it is intended that the Transfer of Undertaking (Protection of Employment) Regulations 2006 will apply to transfer the contracts of employment and continuity of employment to staff of XXXXXX Ltd. It is not envisaged that there will be any legal, economic or social implications of the transfer for staff.'

So this is definitely a TUPE transfer.

This is, aside from letters about their pensions etc, to my knowledge all they have had in writing from the NHS Trust to date.

The following is the content of the sheet they were all given yesterday - note that it refers to 1st August 2012 in the future, not past tense:

'CONSULTATION PROCESS: POSSIBLE CHANGES TO TERMS
AND CONDITIONS
I am very sorry to have to inform you that, for the reasons described below, XXXXXX Ltd ("the Company") believes that it has no alternative but to embark upon a consultation process with you about potential changes to your terms and conditions of employment.

We are committed to build on the provision for the children.

The Commercial Position
As you are aware the company was successful in its bid to XXXXXX NHS Foundation Trust ("the Trust") to provide onsite nursery management services, and hopes to provide those services of the nursery on the XXXXXX Hospital site ("the Nursery") for a minimum of 5 years from 1 August 2012.'

So... looking at this, it appears they have submitted a bid to secure a contract to run three nurseries for the Trust, of which they already have two under their umbrella.

'As you may know, the primary reason that the Trust outsourced nursery functions was that the Nursery had been making considerable operational losses for several years, despite having been heavily subsidised by the Trust.

The subsidy provided by the Trust is not avoiloble to the Company after l August 2012.'

I am not sure what relevance, if any, this has to the nursery my wife works in; if indeed they took over the running of it on 1st August 2012 as the letter appears to suggest, then no subsidies have been paid in respect of it.

'In consequence, theNursery must remain financially viable through normal operational endeavours, just like any other business. That is to say, the Nursery will only remain financially viable if revenues generated from child places exceed the overhead costs of keeping the Nursery running.

We are therefore, presently faced with a not uncommon, but nevertheless serious problem, in the current economic climate.

We simply, with the current costs base, are not able to cover our overheads with the revenues generated and if we are to remain competitive in the marketplace we cannot significantly increase our fees to cover our existing overheads.

Therefore, unfortunately, it will not be possible for the Nursery to remain viable as a going concern unless its cost base is considerably reduced.

If it does not become viable as a going concern, consideration may have to be given to closure. The Company will be looking at all possible areas of the Nursery's business with a view to attempting to reduce costs but, having carefully considered how best to deliver the significant savings needed to allow the Nursery to remain viable, we hove reached a provisional view that it will be impossible to achieve those savings without asking staff at the Nursery whether they are prepared to accept changes to their terms of employment.

We will continue to seek to reduce costs and overheads in other areas such as fuel, heating, lighting, consumables etc but in reality our ability at this time to make significant in roads in these areos is limited.

The Proposals
The Company proposes to consult with all employees at the Nursery about whether they would be prepared lo agree to changes in their terms and conditions of employment. The principal changes being proposed for discussion would be as follows:

Holiday Pay: All full-time employees at the Nursery would be entitled to 5.6
weeks' holiday pay per holiday year, including bank and public holidays (i.e.
28 days).

Sick Pay: Sick pay entitlement would be reduced to statutory sick pay only;
Changes to Working Patterns: The number of hours per week that
employees would be obliged to work will remain the same. However, we will
review the working patterns (days, start and finish times) to assess their
efficiency and may adopt the work pattern as necessary to achieve
efficiencies in delivering continuity of care for the children.

Breaks: All employees would be entitled to a rest break of 30 minutes per
day.

Pay: All employees will hove their rates of pay reduced by 10%.

Pension: All employees would be entitled to join a stakeholder pension
scheme arranged by the Company. Details of which will be provided
separately.

If the proposed changes are implemented, it is planned that the new arrangements would take effect on lst October 2012. This is subject to the outcome of the consultation process and depending upon the degree of employee support.

Next Steps
We are sorry to have to give you this news, and understand that it may give rise to concerns. We now propose to embark upon a consultation process with you and, during that consultation process, we would want to discuss any concerns you may have with a view to seeking to reach an agreement.

A consultation meeting with all staff will take place on 9th August 2012 for all staff present any stoff who are absent will have the opportunity to arrange a 1:1 meeting to ensure every member of staff is consulted on the proposal.

If , after the meeting on 9th August 2012, you have any queries regarding the
proposals, or wish to suggest possible alternatives , please contact XXXXX or XXXXX.

The Company is keen to hear your views on the proposed changes prior to making any final decisions, We are hopeful that during the course of this consultation process you will recognise that these changes are the best way of providing the Nursery with a reasonoble chance of remaining financially viable thus safeguarding the employment of those who work here.

If you agree to these proposols please complete the slip attached to this letter and return it to XXXXX or XXXXX by Monday 27th August 2012, this will shortly be followed with a new contract to sign with the new terms incorporated.'

I have just contacted the HR Department of the Trust, and they have advised that they did all they needed to do legally in terms of staff consultation prior to the transfer. I don't believe they spelt out the implications for the staff in a way that they would have understood, but cannot prove this at present.

It seems a fairly clear statement of intent. If the staff just ignored it and then found the 9th August meeting a shock then they have little excuse in my view.

Reading the above its not entirely clear when the TUPE transfer happened or will happen. Could be 1 August or 27th or another date. Had she been a member of a union then clearly there would have been more dialogue resulting from this communication.

They cannot change her pay or terms and conditions without agreement but its evident they intend to do this on 1 October. Your wife can either accept the new terms (by signing or by carrying on working after the change) Or she can inform HR she does not accept the changes (in which case they will treat this as a resignation). Your wife will either be offered redundancy or need to apply for an employment tribunal to enforce these rights. She should receive redundancy pay based on the terms of her previous employer and the period of her employment since she first took the job.

Personally I would reject the changes and ask to be made redundant on the existing terms.Her NHS Pension to date will not be affected by the changes even if she stays, but clearly her future pension will be much less favourable.

LittleVoice

The threat to close the facility - is it reasonable? If they have a contract with the Trust to provide the service, what are the consequences to them of then not providing the service?

Unfortunately, with the privatisation of the NHS which is upon us, there will be instances of private companies walking away from contracts/failing. When the company is actually providing the health service itself, the tax payer will pick up the bill again.

Bernard_Nurse

Hi... thank you all for your responses.

As an update, I am aware that 2 of the 18 staff affected have definitely signed up to date.

BobQ: My wife is keen to retain her job as for her, it's not all about the money as distressing as she is finding all this, and I am struggling to get her to understand she need not fear 'the sack' if she exercises her rights on this one.

However, she is in a bit of a state about all this and I think they may get their way due to the fear described above.

Jackyann: Not a criticism at all - my wife is someone who has just got on with her job from day one and it doesn't appear she received any advice from her employers about joining a union etc, ergo it's never been anything on her radar unfortunately.

You are quite right on the sickness benefits vs low wage situation - the Trust have been fortunate in the time that she served under them in as much as she rarely took a day off sick.

LittleVoice: I don't believe it is... would anyone?

The call I made earlier to the Trust HR department has obviously rattled a few cages as my wife got a phone call today informing her that the letter (which we already have unbeknown to the new management team) outlining the proposed terms is on its way to her in the post and they want to discuss it with her on Monday.

I wish I could sit in with her, as I am not the push over she can be! :-)

snowcat53

Bernard_Nurse wrote: »

The Commercial Position
As you are aware the company was successful in its bid to XXXXXX NHS Foundation Trust ("the Trust") to provide onsite nursery management services, and hopes to provide those services of the nursery on the XXXXXX Hospital site ("the Nursery") for a minimum of 5 years from 1 August 2012.'

/QUOTE]

Yes it sounds like the TUPE date was probably 1st August

It was also stated before the transfer
"It is not envisaged that there will be any legal, economic or social implications of the transfer for staff.'"

Given this and that the new company had to be aware of the financial situation beforehand, the immediate attempts to change t&cs are exactly what TUPE was designed to prevent, and highly dubious. I suggest you need proper legal advice.